Sumitomo Mitsui DS Asset Management Company Ltd Decreases Holdings in Southwest Airlines Co. $LUV

Key Points

• Sumitomo Mitsui DS Asset Management Company Ltd reduced its holdings in Southwest Airlines Co. by 38.7% during the second quarter, now owning 20,969 shares valued at $680,000.
• Southwest Airlines reported a quarterly earnings miss with an EPS of $0.43, falling short of analysts' expectations of $0.51, and reported revenue declining by 2.1% year-over-year.
• The airline has approved a $2 billion share buyback program, indicating the board's belief that the shares are undervalued.

Sumitomo Mitsui DS Asset Management Company Ltd decreased its holdings in Southwest Airlines Co. (NYSE:LUV - Free Report) by 38.7% in the 2nd quarter, according to its most recent Form 13F filing with the Securities & Exchange Commission. The institutional investor owned 20,969 shares of the airline's stock after selling 13,220 shares during the period. Sumitomo Mitsui DS Asset Management Company Ltd's holdings in Southwest Airlines were worth $680,000 at the end of the most recent reporting period.

Several other large investors have also recently modified their holdings of LUV. GTS Securities LLC increased its stake in shares of Southwest Airlines by 108.8% in the fourth quarter. GTS Securities LLC now owns 7,986 shares of the airline's stock worth $268,000 after purchasing an additional 98,593 shares in the last quarter. Public Employees Retirement System of Ohio increased its stake in shares of Southwest Airlines by 31.0% in the fourth quarter. Public Employees Retirement System of Ohio now owns 284,312 shares of the airline's stock worth $9,559,000 after purchasing an additional 67,307 shares in the last quarter. Forum Financial Management LP increased its stake in shares of Southwest Airlines by 92.2% in the fourth quarter. Forum Financial Management LP now owns 16,599 shares of the airline's stock worth $558,000 after purchasing an additional 7,963 shares in the last quarter. Ameriflex Group Inc. purchased a new position in shares of Southwest Airlines in the fourth quarter worth about $131,000. Finally, Pinnacle Wealth Planning Services Inc. purchased a new position in shares of Southwest Airlines in the fourth quarter worth about $206,000. Hedge funds and other institutional investors own 80.82% of the company's stock.

Southwest Airlines Price Performance

Shares of NYSE:LUV opened at $32.28 on Tuesday. The company has a current ratio of 0.56, a quick ratio of 0.49 and a debt-to-equity ratio of 0.51. Southwest Airlines Co. has a 12 month low of $23.82 and a 12 month high of $37.96. The stock has a market cap of $16.95 billion, a P/E ratio of 48.91, a P/E/G ratio of 0.84 and a beta of 1.19. The company has a 50 day moving average of $32.30 and a 200 day moving average of $31.44.

Southwest Airlines (NYSE:LUV - Get Free Report) last released its quarterly earnings results on Wednesday, July 23rd. The airline reported $0.43 EPS for the quarter, missing analysts' consensus estimates of $0.51 by ($0.08). Southwest Airlines had a return on equity of 6.27% and a net margin of 1.43%.The company had revenue of $7.24 billion during the quarter, compared to analysts' expectations of $7.30 billion. During the same period in the prior year, the firm earned $0.58 EPS. Southwest Airlines's quarterly revenue was down 2.1% on a year-over-year basis. As a group, sell-side analysts forecast that Southwest Airlines Co. will post 1.55 EPS for the current fiscal year.

Southwest Airlines declared that its board has approved a share buyback program on Wednesday, July 23rd that authorizes the company to repurchase $2.00 billion in shares. This repurchase authorization authorizes the airline to buy up to 9.4% of its shares through open market purchases. Shares repurchase programs are generally an indication that the company's board of directors believes its shares are undervalued.

Southwest Airlines Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Wednesday, September 24th. Shareholders of record on Wednesday, September 3rd will be paid a $0.18 dividend. This represents a $0.72 dividend on an annualized basis and a yield of 2.2%. The ex-dividend date of this dividend is Wednesday, September 3rd. Southwest Airlines's payout ratio is currently 109.09%.

Insider Buying and Selling

In related news, Director Sarah Feinberg purchased 1,500 shares of the business's stock in a transaction on Tuesday, August 5th. The stock was acquired at an average price of $30.01 per share, with a total value of $45,015.00. Following the purchase, the director directly owned 14,229 shares in the company, valued at approximately $427,012.29. This represents a 11.78% increase in their ownership of the stock. The purchase was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this link. Also, Director Gregg A. Saretsky purchased 3,345 shares of the business's stock in a transaction on Wednesday, August 6th. The stock was bought at an average cost of $30.03 per share, with a total value of $100,450.35. Following the purchase, the director owned 23,644 shares in the company, valued at approximately $710,029.32. This represents a 16.48% increase in their ownership of the stock. The disclosure for this purchase can be found here. 0.79% of the stock is owned by insiders.

Analyst Ratings Changes

Several equities analysts have recently weighed in on LUV shares. UBS Group lifted their target price on shares of Southwest Airlines from $27.00 to $34.00 and gave the stock a "neutral" rating in a research note on Monday, July 7th. Hsbc Global Res raised shares of Southwest Airlines to a "moderate sell" rating in a research note on Thursday, July 24th. Susquehanna boosted their price objective on shares of Southwest Airlines from $25.00 to $30.00 and gave the company a "neutral" rating in a research note on Tuesday, August 5th. HSBC cut shares of Southwest Airlines from a "hold" rating to a "reduce" rating in a research note on Thursday, July 24th. Finally, JPMorgan Chase & Co. boosted their price objective on shares of Southwest Airlines from $28.00 to $35.00 and gave the company an "overweight" rating in a research note on Friday, September 12th. Five analysts have rated the stock with a Buy rating, nine have assigned a Hold rating and four have given a Sell rating to the company. According to data from MarketBeat.com, the stock has a consensus rating of "Hold" and an average price target of $33.38.

Southwest Airlines Company Profile

Southwest Airlines Co operates as a passenger airline company that provides scheduled air transportation services in the United States and near-international markets. As of December 31, 2023, the company operated a total fleet of 817 Boeing 737 aircraft; and served 121 destinations in 42 states, the District of Columbia, and the Commonwealth of Puerto Rico, as well as ten near-international countries, including Mexico, Jamaica, the Bahamas, Aruba, the Dominican Republic, Costa Rica, Belize, Cuba, the Cayman Islands, and Turks and Caicos.

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